Bae Juice secures landmark deal with Coles Express as US strategy gains momentum

The deal with Coles Express, which co-founder Tim O’Sullivan says has been three years in the making, will initially comprise a month-long trial during the key football finals season ahead of a potential expansion of the agreement.

“It’s the first time that any hangover prevention drink has broken into this sort of retailer,” O’Sullivan tells Business News Australia.

“We’ll be on the front counter next to the likes of Cadbury and Wrigley’s which is huge. It’s a four-week deal right among some of the biggest players in confectionary.”

The Coles Express arrangement, which kicks off this week, builds on Bae Juice’s existing distribution deals with Woolworths, BWS and Dan Murphy's.

The company has also started pushing into Coles’ liquor brands on a store-to-store model with Liquorland, First Choice and Vintage Cellars.

“We like to think we dominate grocery, alcohol and retail and now we are finally getting convenience,” says O’Sullivan of the Coles Express breakthrough. “We are really stamping our authority across this distribution.”

Bae Juice was founded in 2019 by O’Sullivan, Liam Gostencnik and Sumin Do and plans to become a market leader in the category with its hangover prevention juice which is made entirely from Korean pear juice.

The business launched into the US in January after securing an agreement with US-based company Gold Coast Distributors to supply Bae Juice in the New York Tri-state area.

O’Sullivan confirms that Bae Juice is now stocked in 200 stores in Manhattan and Brooklyn.

However, the Bae Juice co-founder notes that the deal with Coles Express is critical to proving the company’s innovative marketing strategy of getting its product in front of consumers globally.

“We are really excited to shake the narrative of how brands launch into retail,” says O’Sullivan.

“We don’t use a traditional model of billboards, posters and celebrities. Our model is really a heavy social media push.

“Every single day for the next four weeks we’ll be doing some collaboration with Coles Express from video content, Instagram and TikTok.

“Instead of working with influencers with lots of followers and no engagement, we’re working with some really fun, creative YouTubers.”

O’Sullivan describes the strategy as “difficult”, but he believes they have struck “the right formula”.

“We really like to think we are not only pioneering our product into the market but also pioneering how to promote and market your brand in a retailer.

“I think that’s really important. Our social media strategy is simple, get as many eyeballs on the product as possible and push consumers to our loyal retailers.

“We think that as a young brand without a million-dollar budget, we are really paving the path to how to market your company into retail.”

Bae Juice has largely been bootstrapped since it was founded, although earlier this year the company announced a $1 million capital raise that brought technology and gaming entrepreneur Laurence Escalante’s family investment vehicle Lance East Office on board as an investor.

O’Sullivan says growth in the US is likely to lead to an even bigger capital raise, most likely in US dollars, in future as the company scales.

“The next time we will be looking for international investors who are going to support us strategically with our growth outside of Australia,” he says.

O’Sullivan and Gostencnik recently returned from the US where the Bae Juice co-founders spent time on the ground engaging with their key demographic.

“The market response in the US has been amazing,” says O’Sullivan.

“We gave thousands of units around Brooklyn at universities where we were engaging with students and getting content from all these young Americans while they were drinking.

“We’ve got a really great distributor in New York; they have a sales team of about 10 and they are hitting the streets of New York every day pushing Bae Juice into stores.

“By the end of this year, we want to land our first major retailer and we’re pretty confident of that. We’ve already started pitching them.”

Although it only launched in the US earlier this year, Bae Juice has been working on the US business for the past two years.

“We have learnt a lot over this time, and we are really confident as a team and as a product in exactly what we need to do to take that next step and make the US a success,” says O’Sullivan.

The latest Coles Express deal brings the total store count selling Bae Juice globally to about 5,000.